The owner of Oddbins has warned staff of job losses in the near future as the off licence business said it had appointed advisers to look at options for the future after an “extremely tough” Christmas.
In an email to staff at European Food Brokers group, which also includes Wine Cellar Trading and Whittalls Wine Merchants, directors said they had concluded that its retail businesses “cannot continue in their current form” and may have to be sold.
The email, seen by the Guardian, said Duff & Phelps, an advisory firm that specialises in administration, had been appointed to consider a way forward for the group, which employs more than 500 people at more than 100 off licences.
The message emerged after Sky News reported that the company’s retail businesses had filed a notice of intent to appoint administrators, a legal procedure providing protection from creditors for 10 days.
If the company calls in administrators, it would be the second time that Oddbins, which started life in 1963, has collapsed in less than a decade. EFB bought its stores out of administration in 2011.
“The past couple of months have been extremely tough trading-wise and, like the rest of the high street in the UK, the important Christmas period was difficult for us,” directors wrote.
They said sales at established stores had fallen and that the company had been affected by a significant drop in the value of the pound against major currencies and an average 17.8% rise in rent on its properties, all of which had put “a significant strain on the cash flow of the business”.
“At this stage, all businesses should continue to trade until further notice. However, we owe it to you as our loyal employees to be honest and say to you that it is highly likely that, devastatingly, there will be job losses in the near future,” the email warned.